EPOP and LFPR Exceed Pre-COVID Levels
For all of the political backbiting over these two metrics, as of the February 2023 reading, Prime Age Employment to Population has now matched the pre-COVID high, and wonder of wonders, the Prime Age Labor Force Participation Rate has now exceeded the pre-COVID level. On to the next crisis! Perhaps a shortage of baby carrots.
The New York Fed released this report on Labor Force Participation on March 30, two weeks after my original post. They attribute the shortfall in overall LFPR to just one factor: people are aging out of the workforce, and that's why it's important to use the Prime Age bracket as the most accurate picture of the labor economy. On the younger end of the labor force spectrum, people can enter the workforce at various stages, depending on their educational or vocational choices. On the older end, more acutely thanks to the "Boomer" cohort, participation fades out. Eliminating these variables and looking at the cohort with most settled employment status gives a more telling picture. As has been mentioned on this site a dozen times, quoting economist Roger Farmer: "Participation is a choice. Unemployment is not. Unemployment is cyclical. Participation is secular."